Abstract
Sebastian Edwards has presented an interesting and convincing empirical study. It gives strong support to the hypothesis that real exchange rate instability has greatly increased for developing countries after the end of the Bretton Woods regime. Moreover, strong evidence is provided that this greater variability of real exchange rates has had a sizable negative impact on average real growth and on average real per capita growth in these countries. The influence on investment ratios turns out to be much weaker, whereas no such influence seems to exist on the growth of exports. The latter result is in accordance with earlier research, notably a study of the International Monetary Fund.
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References
Bernholz, Peter (1982), Flexible Exchange Rates in Historical Perspective, Princeton Studies in International Finance, vol. 49, Princeton University, International Finance Section, Dept. of Economics.
Bernholz, Peter; Gaertner, Manfred; and Heri, Erwin (1985), Historical Experiences with Flexible Exchange Rates, Journal of International Economics, vol. 19, pp. 21–45.
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© 1989 Springer-Verlag Berlin Heidelberg
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Bernholz, P. (1989). Comments. In: Vosgerau, HJ. (eds) New Institutional Arrangements for the World Economy. Studies in International Economics and Institutions. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-83647-3_5
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DOI: https://doi.org/10.1007/978-3-642-83647-3_5
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